Downer has extended the deadline of its $1.2 billion takeover offer for Spotless for a third time, giving remaining shareholders until Friday, 21 July to accept its bid.
Downer announced on Tuesday, 11 July it had extended the deadline by an additional 10 days, encouraging shareholders to accept the offer as soon as possible.
At the time of publication Downer’s shareholding in the cleaning, catering and facilities management had climbed to 64.3 per.
Despite Downer’s controlling stake, Spotless has continued to urge remaining shareholders to reject Downer’s offer stating the engineering and maintenance firm “remains well short of its strategic objective of outright control of Spotless” after three months since its initial bid.
Spotless chairman Garry Hounsell said the Spotless board continues to hold the view that “Downer’s opportunistic offer does not represent adequate value”.
“If it doesn’t achieve its original objective of gaining outright control and full ownership of Spotless, Downer may well need to make a new, improved offer to convince remaining Spotless shareholders to accept,” Hounsell said.
“There of course can be no guarantee of such an offer emerging. Although there are risks associated with remaining a minority shareholder, these risks are mitigated while Spotless remains listed and there is a large and supportive minority shareholding.”
Renewed contracts total more than $250m
Earlier this month Spotless announced a number of new contracts and renewals totaling more than $250 million.
Continued contracts include a short term extension with South Australia Health for three metropolitan Adelaide hospitals; the renewal of a three-year security services contract with the Port Authority of NSW, and a five-year facilities management deal with department store Myer. The company also secured a five-year catering contract with Sydney’s Taronga Zoo.
The renewals follow the opening of Spotless’ new laundry facility in Melbourne’s east, following its takeover of Victorian linen and laundry business Cabrini Linen Service in May.
The 9000sqm purpose built, eco-laundry employs 160 staff and features high-tech equipment and water treatment facilities.
Spotless confirmed in May it had entered into a purchase agreement for the Victorian linen and laundry business, stating at the time that the acquisition was set to double its laundry volumes across the state.
The purchase included the Dandenong South facility as well as a number of new multi-year healthcare laundry contracts, including an initial 10-year contract with Cabrini Hospital.